Sunday, April 1, 2012

Is this what Harper has in mind by fast tracking resource projects?

Last week's budget had Harper fast tracking resource projects (in his desperate attempt at creating jobs at the expense of all other considerations). Is this what Err Harper had in mind?

China must improve its construction record
Diane Francis
Financial Post
Mar 31, 2012

Chinese companies should be banned from construction work in Canada because of their questionable track record here and around the world.

It was shocking that Enbridge Inc.’s Pat Daniel said his company was willing to allow a Chinese company to buy a stake in and to bid for the construction of the proposed Northern Gateway oil sands pipeline.

Not only should Chinese companies be banned from construction or bidding but Investment Canada should ban them from buying resource companies or related assets.
China’s strategy is to buy resources around the world, then low-ball to get construction contracts by using Chinese laborers and materials. This is not only damaging to the domestic economy, and unnecessary, but in some cases laws and obligations have been flouted.

Just for the record, my husband heads Canada’s largest infrastructure and construction public company in Canada.

In 2007, Sinopec Shanghai Engineering Company brought in 132 Chinese workers to an Alberta oil sands site to assemble their storage tanks and do other work. Two workers were killed and several injured. The remaining Chinese workforce was moved out of Alberta and work stopped.

The Alberta government charged Sinopec, its subsidiary and their oil sands client with 53 safety charges. Sinopec and its branch plant have refused to appear in court. They say they have not been served papers because they are in China where they cannot be served papers to appear in court. Instead of acceding to Canadian law, they have not appeared.

In November, an Alberta Court of Appeal ruled the company must stand trial on these serious charges. In February, Sinopec said it wants the Supreme Court of Canada to overturn this ruling because it should be exempt.

The 132 Chinese workers were not paid an estimated $3.17 million by their Chinese employer even though they worked four months before the accident. Alberta employment standards spokesman Barrie Harrison said that the prime contractor, the Canadian oil sands project client, put the $3.17 million in wages and benefits in trust even though it had no obligation to do so.

In an interview last year, Harrison said: “We are still trying to determine the best, most secure method of returning these funds to the workers, who are now either back in China or working at other sites around the world. We’ve had nothing new to report on this file for quite some time.”

The Canadian embassy in Beijing has been involved in trying to right this wrong, at taxpayer expense.

This outrageous behavior by China and its companies should be reason enough to ban Chinese companies from bidding on construction work or having workforces in Canada. After all, a major corporation has no respect for the rule of law here; has damaged Chinese workers; damaged its Canadian client; cost the taxpayers of Alberta a great deal of money to try and clean up the mess and prosecute wrongdoing and has cost the taxpayers of Canada, Canada’s immigration department and Canada’s justice system as well.

This behavior is not unique to Canada.

Shoddy work and broken promises have occurred elsewhere. In Angola, in July 2010, more than 150 patients had to be evacuated from a new Chinese-built hospital in Luanda, after its walls began cracking and bricks began disintegrating. China Overseas Engineering Group Co. (COVEC) built the hospital for $8 million. Reports began to come out in the local media that many roads, schools, hospitals and other infrastructure completed by the Chinese were sub-standard or unsafe and promises to employ Angolans were not kept.

Another example was reported in 2010. The Chinese were finally able to penetrate the European Union when COVEC won a bid to build a major highway in Poland by bidding less than half the price of domestic contractors. This caused consternation across the EU because of Chinese tactics around the world. The pattern is well worn: Chinese firms low ball to beat out local competition then bring in substandard materials and workers from China.

The Poles were committed to tender bidding for the contracts, and were stuck with accepting COVEC’s basement bid but were wise to the tactics. So they stipulated that the company could not import Chinese materials, supplies or labour.

But COVEC reportedly flouted this requirement and started to bring in Chinese workers anyway, claiming that Polish workers were not cooperative and would not take pay cuts.
Then they began sourcing supplies from China, claiming Polish suppliers refused to match Chinese prices.

In June 2011, COVEC stopped work. Poland sued COVEC for $271 million in damages for breach of contract. And the country has had to spend huge amounts to complete the highway in time for the 2012 European Football Championships in Poland this summer. COVEC told China Daily it was asking for compensation.

For these reasons and more, Canada must ban any bidding or work permits to Chinese workforces. They simply are not acceptable. They are also not the only buyers for oil sands production. A pipeline can deliver oil to the west coast and then to Asian and South American markets by sea.


Bruce said...

Just another episode of Steamroller Steve.

Anonymous said...

China has great glossy infrastructure
magazines to impress us !! while they are printed in crumbling buildings !
And lets not forget they can build a 2 story building in 24 hours !